We have obtained pilot data demonstrating that tracheal aspirates from week-old premature infants undergoing mechanical ventilation for respiratory distress syndrome (RDS) contain colony-forming fibroblast- like cells with surface markers and differentiation potential typically found in mesenchymal stem cells. The cells are positive for Stro-1, CD73, CD90, CD105 and CD166, but negative for CD34, CD45 and CD11b, suggesting that they are of stromal but not hematopoietic origin. Further, they exhibit ample proliferative capacity and are capable of differentiation into osteocytes, adipocytes and myofibroblasts. Conditioned medium from these cells enhances epithelial growth and repair, inhibits squamous differentiation and contains basic fibroblast growth factor (bFGF/FGF-2), keratinocyte growth factor (KGF) and vascular endothelial cell growth factor (VEGF). Finally, the isolation of multipotent mesenchymal cells from the tracheal aspirates of premature infants with RDS is associated with a prolonged requirement for supplemental 02 and the development of chronic lung disease, i.e., bronchopulmonary dysplasia (BPD). We therefore hypothesize that multipotent lung mesenchymal cells participate in neonatal lung repair and are a biomarker for lung injury. To test this general hypothesis, we propose the following Specific Aims. Specific Aim 1: Determine mechanisms by which multipotent lung mesenchymal cells from premature infants are recruited to the airspaces. We hypothesize that epithelial injury induces expression of bFGF and monocyte chemoattractant protein (MCP)-1, thereby promoting lung mesenchymal cell migration to the airspaces. Specific Aim 2: Characterize potential mechanisms by which multipotent lung mesenchymal cells participate in lung repair. We hypothesize that: 1) lung mesenchymal cells produce trophic factors capable of promoting respiratory epithelial repair;2) when stimulated by transforming growth factor (TGF)-fl, lung mesenchymal cells differentiate into myofibroblasts, thereby promoting angiogenesis and fibrogenesis. Specific Aim 3: Correlate the presence of multipotent lung mesenchymal cells in premature infants with the development and severity of chronic lung disease. We hypothesize that multipotent lung mesenchymal cells are biomarkers for lung injury and persistent pulmonary dysfunction. We will prospectively compare the clinical outcomes of premature infants from whom multipotent lung mesenchymal cells have been isolated with those from whom cells are not isolated, focusing on respiratory system compliance and days of oxygen supplementation. Understanding the role of multipotent lung mesenchymal cells in the pathogenesis of BPD will lead to improvements in the treatment of this disease.